Tennessee Paycheck Calculator
Free Tennessee paycheck calculator. Estimate your take-home pay with current Tennessee state tax rates and federal withholdings. Calculate federal income tax, Social Security, Medicare, and Tennessee state withholdings instantly.
What you should know about Tennessee taxes
Tennessee has no state income tax on wages or salary. The old "Hall Tax" on interest and dividends was phased out completely in 2021. Tennessee workers keep every dollar of their earnings after federal tax and FICA.
No State Income Tax
Tennessee does not levy a state income tax on wages. Your paycheck deductions are limited to federal income tax, Social Security (6.2%), and Medicare (1.45%).
Tennessee: Zero Income Tax Since 2021
Tennessee eliminated its last remaining income tax — the "Hall Tax" on interest and dividends — as of January 2021. The state now has absolutely zero income tax on any type of income. Your paycheck only has federal income tax, Social Security, and Medicare deducted. For a Nashville worker earning $65,000, the zero state tax means roughly $2,500–$4,000 more per year compared to working in Georgia (5.49%), Alabama (5%), or North Carolina (4.75%). Tennessee funds itself through a 7% state sales tax — one of the highest in the nation — plus local additions that push the combined rate to 9.75% in some areas.
Nashville's Booming Economy
Nashville is one of the fastest-growing cities in America. Healthcare (HCA Healthcare, Community Health Systems, Vanderbilt), entertainment/tourism, and a surging tech sector have created a red-hot job market. Amazon chose Nashville for a major operations hub. AllianceBernstein relocated its headquarters from New York. The influx of corporate relocations is directly tied to the zero income tax. Memphis anchors western Tennessee with FedEx and logistics. Chattanooga and Knoxville offer lower cost of living. The federal minimum wage of $7.25 applies, but actual starting wages in Nashville run $14–$18+ due to competition. The biggest budget concern for Tennessee residents is the high combined sales tax rate on purchases.